Short answer
A chargeback is a card payment reversed by the cardholder’s issuing bank after a dispute, pulling the funds back from the merchant along with a fee. It is not a refund: the merchant does not control it, learns of it after the money has gone, and must contest it with evidence within a deadline.
Also called: Payment dispute, Card dispute
The process runs on reason codes. The issuer files the dispute under a category such as fraud, goods not received, or goods not as described, and the merchant may respond with representment, which means submitting evidence that answers that specific category. Delivery confirmation answers a not-received claim; product photographs and the listing description answer a not-as-described one. Cards authenticated through 3-D Secure shift fraud liability toward the issuer, which is the main reason to enable it.
Prevention is operational rather than technical. Use a billing descriptor customers recognise on a statement, describe products and delivery times accurately, and answer messages quickly enough that an unhappy buyer contacts you before contacting a bank. Keep delivery proof retrievable per order, because a dispute arriving weeks later is won or lost on whether that record can be found. Repeated chargebacks put the merchant account itself at risk, not only the individual sale.
Common questions
Can a GCash or Maya payment be charged back?
Not through the card networks. Wallet payments are disputed through the wallet operator’s own process, which has different evidence requirements and timelines from a card chargeback. Cash on delivery has no chargeback mechanism at all, though it carries the equivalent exposure in refusals at the door and returns.
Is a chargeback the same as a refund?
No. A refund is initiated by the merchant, on the merchant’s timing, through the payment provider. A chargeback is initiated by the cardholder through their bank, reverses the funds without the merchant’s agreement, usually carries a fee, and counts against the merchant regardless of who was right.
Where this comes up in our work
Related terms
Payment Gateway
A payment gateway is the service that carries a customer’s payment details from a checkout to the institutions that authorise and settle the money — card networks, banks, e-wallets.
Cash on Delivery (COD)
Cash on delivery is a payment arrangement where the buyer pays the courier at the doorstep and the courier remits the proceeds to the merchant later.
Order Management System (OMS)
An order management system is the software that holds an order from capture to delivery: recording it once, checking stock, routing it to a warehouse or courier, tracking its state, and handling cancellations, returns and refunds.
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